Humber/Ontario Real Estate Course 4 Exam Practice

What is true when a buyer signs an agreement of purchase and sale under seal?

1. The buyer cannot withdraw the offer once presented to the seller.

2. The buyer can withdraw the offer at any time before the seller accepts it.

3. The buyer can withdraw the offer after it has been presented, but only if there are competing offers.

4. The irrevocable clause becomes binding immediately upon the buyer signing the agreement.

5. The offer can be revoked only after seller’s acceptance.

6. The offer must remain open until officially closed by the buyer.

The correct answer is: The buyer cannot withdraw the offer once presented to the seller.

When a buyer signs an agreement of purchase and sale under seal, it establishes a legally binding commitment to the terms laid out in the document. This means that once the agreement is executed by the buyer, they are generally obligated to uphold the terms without the option to withdraw the offer unilaterally. This principle holds because the sealing of the agreement indicates an intention to create a serious legal obligation, thereby making it difficult for the buyer to change their mind or withdraw the offer without facing potential legal repercussions. In this context, the notion of being unable to withdraw the offer once it has been presented to the seller stems from the legal implications attributed to agreements under seal. Unlike preliminary negotiations or non-binding agreements where a buyer retains more flexibility, the act of signing under seal signifies that the buyer is committed to the transaction as stipulated, thereby emphasizing the enforceability of the agreement. Other choices suggest varying degrees of flexibility or conditions regarding withdrawal, but the key takeaway is that once a buyer has signed an agreement under seal, they are bound to that agreement, reinforcing the concept of irrevocability inherent in such contracts.